Colorado Surplus Lines study guide
Colorado Surplus Lines · Work through your exam, one topic at a time.
The Colorado Surplus Lines Producer license is a Colorado Division of Insurance (DOI) credential that authorizes a licensed property and casualty producer to place coverage with eligible non-admitted insurers when the admitted market cannot or will not write the risk. It is intended for experienced commercial lines producers, agencies and brokers who regularly handle hard-to-place exposures - coastal or wildfire-prone property, specialty liability, unusual classes of business - and who need the ability to access the surplus lines market on a client's behalf. The Colorado Surplus Lines study guide has 4 sections and about 1,704 words.
01Colorado Insurance Statutes, Rules and Regulations
Colorado insurance law is codified in Title 10 of the Colorado Revised Statutes. Article 2 governs producer licensing (a surplus lines broker is a licensed producer holding special surplus lines authority), Article 3 governs insurer regulation and premium taxation, and the state's surplus lines provisions sit within Article 5, "Insurance – General." The Commissioner of Insurance heads the Division of Insurance (within DORA) and holds rulemaking, examination, and disciplinary authority.
687 words, about 3 min02General Insurance Principles and Concepts
Insurance transfers and pools pure risk. The principle of indemnity restores the insured to roughly its pre-loss financial position, never better.
319 words, about 2 min03Surplus Lines Placement and Diligent Search
(1) Confirm the coverage is genuinely unavailable from authorized insurers; (2) determine the insured's home state ; (3) perform and document the diligent search; (4) deliver the written disclosure and obtain acknowledgment; (5) verify the nonadmitted insurer is eligible; (6) bind, collect premium and tax; (7) report and retain records. A diligent effort means seeking the full amount and terms of coverage required from authorized insurers that actually write that class of business in Colorado.
372 words, about 2 min04Premium Tax and Recordkeeping
Colorado imposes a surplus lines premium tax measured by gross premiums charged on Colorado-home-state surplus lines policies, less premiums returned to the insured. The broker collects the tax from the insured at placement and remits it; the nonadmitted insurer does not file or pay Colorado premium tax, and the tax is not carved out of the broker's commission.
326 words, about 2 min